FTSE climbs as investors pile into financial stocks
FINANCIAL stocks helped Britain’s top share index climb yesterday as hopes of a resolution to Greece’s debt problems spurred appetite for riskier assets.
Banks were in demand, led by part state-owned Royal Bank of Scotland as investors bet the Greek parliament will this week vote through austerity measures needed to secure more aid from international lenders, despite violent protests in Athens. RBS was up 4.2 per cent following recent underperformance.
A trading update from Standard Chartered, up 2.7 per cent, also improved appetite among investors for banks, which have been under pressure on concerns over their potential exposure to the European debt crisis.
The FTSE 100 index closed 44.54 points, or 0.8 per cent, higher at 5,766.88, adding to Monday’s 0.4 per cent advance.
London’s blue-chip index retreated from a high of 5,795.10, however, as uncertainty lingered over the health of the world’s biggest economy as a moderation in the decline of US house prices was offset by gloomy consumer confidence figures.
Miner Vedanta Resources gained 3.5 per cent, helped by late news on Monday that its long-delayed deal to buy a stake in Cairn India got a boost as vendor Cairn Energy cut the price tag and split the sale into two tranches. Cairn also gained three per cent.
Tate & Lyle was the worst blue chip faller, down 1.8 per cent after RBS cut its rating to “hold”.